Public accountability procedures in politics in Latvia
Preliminary Report
EU RTD Project “Researching Public Accountability Procedures in Different European Contexts”, PubAcc Project (HPSE-CT2001-00076)
Workpackage 1: National Profiles: Latvia
Authors: Tālis Tisenkopfs and Valts Kalniņš
Rīga
Baltic Studies Centre February 2002
Executive summary
The report addresses research tasks of the 1st work package of the Project and its aim is to give an overview description and analysis of state of the art of public accountability procedures in Latvia.
The analysis is based on mainly qualitative data gathering together with some elements of quantitative data drawn from earlier research. Data obtained by using various methods tend to mutually confirm the major conclusions of the report.
The report contains a theoretical framework of public accountability, analyses relevant public discourses, presents an overview of accountability mechanisms and procedures in Latvia, and discusses successes, problems and challenges.
Various groups of political agents are more familiar with the concept of political responsibility and responsible governance rather than public accountability. Other concepts, which illuminate aspects of public accountability, are transparency, access to government information, participation in policymaking, cooperation between government and other stakeholders, and legal responsibility of officials.
Most of interviewed experts referred to insufficient responsibility of politics and governance in Latvia, citing problems such as corrupt behaviour, the dependency of political parties on economic groups, the flaws of administrative reforms (low administrative capacity).
Although the civil society is developing, widespread distrust in politics and the lack of skills of democratic participation result in insufficient public demand for accountable governance.
On the positive side, several new developments have emerged: improved access to government information, cooperation between state institutions and civil society organizations in a number of consultation councils in the process of policy formulation and implementation, new initiatives of state administration to open policy making for public participation.
However, these new initiatives towards open, transparent, and participatory policy making are yet to be consolidated in order to achieve systemic improvements.
A latent conflict exists between increasingly accountable administrative activities and continuously non-transparent political decision-making. Another challenge is the enforcement of accountability in increasingly decentralizing governance. Yet one more challenge is related to the effects of the expansion of information technologies in policy making that both increase opportunities for participation and discriminates against those who do not possess necessary technical means and skills.
Table of contents
Executive summary ………. P. 2 Table of contents ………. P. 3 Introduction ………. P. 4 1 Methodology ………. P. 4 2. Results ……… P. 5 2.1. Linguistic connotations and terminology ………. P. 5 2.1.1. Theoretical definition of public accountability ………. P. 5 2.1.2. Perceptions and meanings of public accountability in Latvia ………... P. 6 2.2. Concepts and ideas of public accountability ……… P. 9 2.2.1. Seven discourses of public accountability ………. P. 9 2.2.2. Concepts and normative ideas of public accountability ……… P. 11 2.3. Political system ………. P. 13 2.3.1. Constitutional framework and its functioning ……….. P. 13 2.3.2. Public administration………. P. 15 2.4. Public sphere ……… P. 17 2.5. Private sector ……… P. 18 2.5.1. Legitimate vs. illegitimate influence………. P. 19 2.5.2. Large vs. small business……… P. 20 2.6. International organisations and governance………. P. 21 2.7. Issues/ problems ………... P. 23
2.7.1. Functioning of political system ……… P. 23 2.7.2. Sectoral issues……… P. 24 2.8. Mechanisms and procedures of public accountability………. P. 25 2.8.1. Empowering civil society……….. P. 25 2.8.2. Empowering civil society together with internally strengthened …………. P. 27
accountability
2.8.3. Internally strengthened accountability ……….. P. 28 2.8.4. Public accountability mechanisms and procedures in different ………….. P 29
policy sectors
2.9. Outcomes ………. P. 30 3. Conclusions and discussion ……… P. 31 3.1. Overcoming Soviet legacy in policy-making ……….. P. 32 3.2. Handling new challenges of democracy ……….. P. 32 3.2.1. State capture ………. P. 32 3.2.2. Lax administrative practices ………. P. 32 3.2.3. Flawed party system……….. P. 33 3.2.4. Informational revolution in governance?………... P. 33 3.2.5. Legislative formalism……… P. 34 3.2.6. Decentralisation………. P. 34 3.2.7. Moral and social responsibility of politics……… P. 34 3.3. Theoretical model of public accountability………. P. 35 References ……….. P. 37 Annex 1 List of interviews ………. P. 38
Introduction
This is the Latvian report on the EU Joint Research Project “Researching Public Accountability Procedures in Different European Contexts”. The report addresses research tasks of the 1st work package of the Project and its aim is to give an overview description and analysis of state of the art of public accountability procedures in Latvia. Based on a range of qualitative methods the report investigates different aspects of accountable governance.
Firstly, it characterises linguistic connotations and terminology of public accountability in Latvia. Secondly, it describes political system and political culture in Latvia. Thirdly, the report deals with impact of private sector and international organisations on policy-making processes in Latvia. Fourthly, analysis highlights issues, which have particularly activated discussions about responsibility in politics and governance. Fifthly, the report examines mechanisms and procedures, which are used in different policy sectors and at different levels of decision-making in order to make policies more transparent, participatory and accountable to people. Finally, the report draws conclusions about the current developments and problems with respect to democratic accountability in Latvia and discusses future challenges and their theoretical implications.
1 Methodology
The methodology contains mainly qualitative data gathering together with some elements of quantitative data drawn from earlier research. Therefore, while the data allows us to make some generalisations, they should be treated with due caution. Our set of methods reveals both valid and reliable insights into various discourses on public accountability issues.
Structured interviews are a key method that is used to reveal detailed and nuanced information about how various agents perceive public accountability issues. Methods such as documentary analysis and case studies provide the report with hard data and exemplify more general observations made in this report. Data obtained by using various methods tend to mutually confirm the major conclusions of the report, thus strengthening confidence in the accuracy of the findings. Below particular methods used for data collection and analysis are characterised:
1. Documentary analysis and overview of existing researches.
2. Structured interviews with policy actors: politicians, civil servants, journalists, political scientists, NGO leaders, entrepreneurs, lawyers and representatives of international organisations. In total 18 interviews were carried out. The list of interviews is given in Annex 1.
3. Participatory observation of policy expert meetings: the Annual Conference of Latvian Lawyers Association, the meeting of Policy Dialogue Group which represents different government institutions, the public discussion “Identity, Dialogue and Social Integration” organised by the Ministry of Justice and the Regional Consultations for Central and Eastern Europe on Deepening Democracy in a Fragmented World organised by the UNDP Human Development Report Office.
4. Media screening (mainly the national daily newspapers were inspected) with focus on editorials and analytical articles dealing with issues of public accountability.
5. Case studies of public institutions and policy sectors carried out by sociology students of the University of Latvia during the course on Public Institutions in Latvia. The students examined procedures of public accountability in 19 different policy sectors and wrote analytical essays. These essays were used as a material for our secondary analysis.
6. Feedback consultations with political scientists. During data analysis and writing this report we consulted two political scientists for clarifications and feedback verification of our preliminary findings. This helped to sharpen some of the arguments.
7. Informal conversations with politicians. One of them was a minister and another was a director of the State Chancellery. These conversations gave valuable insights in top- level policy-making process.
8. Expert questionnaires. During the Annual Conference of the Latvian Lawyers Association we distributed 22 questionnaires asking respondents to answer the same questions as in structured interviews. Only 3 filled in questionnaires where returned by mail. The low return rate indirectly indicates that the concept of public accountability is not well recognised among lawyers and policy actors in Latvia in general.
9. Team’s regular internal discussions.
2. Results
2.1. Linguistic connotations and terminology
2.1.1. Theoretical definition of public accountability
Before starting the research we came to terms of our own theoretical understanding and definition of public accountability. We followed hypothesis of the PubAcc Project and theoretical paradigm developed by Jurgen Habermas. According to Habermas public accountability is a fundamental principle of democratic governance, which establishes integrity between the civil society, the state and different social groups in the modern society.
In Habermas’s theory public accountability is conceptualised by means of such other concepts as public and private sphere, civil society and the state, mediation of interests, communicative action (Habermas 2001, 1999, 1998, 1989). We also referred to ideas and findings of our former research of public policy process in Latvia published in the recent edition of Latvia Human Development Report 2000/2001 (UNDP 2001). We agreed upon the following working definition of public accountability:
“Public accountability is a relationship between politicians and government institutions, on the one hand, and electorate and population, on the other hand, which ensure consideration of public interests in decision-making process and enhance formulation and implementation of efficient and responsible policies.”
According to this definition public accountability can be operationalised as mechanisms and procedures of balanced exercising of power through which public interests and needs for efficient policies are met.
There are many other concepts, which specify particular aspects of public accountability:
access to information, public participation in policy-making process, political responsibility, administrative responsibility, the rule of law, co-operation between the state and civil society, respect to public good and public interests, restriction of certain private interests, the observance of democratic principles in governing institutions, obligation to steer policies towards certain ends, public trust. In Figure 1 these theoretical concepts are shown as elements of functional relationship between politicians and government, on the one side, and population and citizens, on the other side.
Figure 1. Theoretical concepts and functional role of public accountability PUBLIC ACCOUNTABILITY
as mechanisms and procedures of balanced exercising of power through which public interests and needs for efficient policies are met
Politicians, government, public institutions
Related concepts:
• Access to information (transparency, openness)
• Public participation in decision-making process (opportunity to influence decisions made by politicians, actual participation in decision making)
• Political responsibility (e.g. responsibility of political parties, responsibility of politician over decisions made)
• Administrative responsibility (e.g. legal responsibility of state officials)
• The rule of law (e.g. just, independent and efficient courts, supremacy of law over administrative instructions)
• Co-operation between the state and civil society (e.g. delegation of power and responsibilities to NGOs, involvement of NGOs in policy formulation)
• Respect to public good and public interests
• Restriction of certain private interests
• The observance of democratic values (e.g. honesty, responsibility, transparency) in governing
institutions
• Obligation to steer policies towards a certain ends (e.g. welfare of the nation, democracy, prosperity of people, social security)
• Trust in relations between population and political institutions
Population, citizens, electorate
2.1.2. Perceptions and meanings of public accountability in Latvia
Having elaborated this theoretical definition we confronted more complicated reality of perceptions and meanings of public accountability when we started investigations of actual accountability discourses and practices in Latvia. It became obvious that different words which designate one or another aspect of public accountability are being used in fragmented way and there is no one single discourse of public accountability. Even some policy experts did not understand this concept in its full complexity. For many interviewed policy actors it was much easier to distinguish the concepts of responsible politics and responsible governance than to grasp the notion of public accountability.
One part of interviewed experts doubted the very existence of public accountability awareness among Latvian politicians and population in general: “Public accountability concept has not yet anchored in the Latvian political language. Moral and ethical principles in politics – they also have not found their roots” (Int. No. 15). “In Latvia not only ordinary people, but also policy makers do not understand these concepts [public accountability, responsible governance] properly. Accountability is often reduced to financial accountability, but what does public accountability means is not so clear for them” (Int. No. 16). One expert even indicated, “Political responsibility is perceived as irresponsibility.” (Int. No. 4)
Other experts emphasised that at the level of normative thinking politicians recognise the need for political responsibility, however, in practice it has been often ignored: “I have not found an answer what political accountability means in Latvia and how it is implemented. Is it responsibility when politicians move from one [political] party to another? Do we have political parties at all or do we have just interest groups?” (Int. No. 17.)
During the fieldwork interviews, press screenings and case studies of public institutions we collected variety of words and expressions which are being used by different political actors – journalists, civil servants, NGOs leaders, political scientists, etrepreneurs, lawyers, politicians and local municipality leaders to characterise their understanding of public accountability.
These expressions are summarised and classified in Figure 2.
Figure 2. Vocabulary of positive and negative meanings of public accountability, as used by different policy actors (answers to the question “How public accountability is understood in Latvia? What other concepts characterise public accountability?” The language of respondents has been retained in the expressions, with quotes placed in quotation marks, key meanings underlined.)
Positive meanings/ enforcement of accountability Negative meanings/ lack of accountability
• “Willingness to influence processes in the country”
• “Responsibility of officials for the consequences of their actions”
• “Ability to foresee the consequences”
• “Transparency automatically require responsibility. As soon as things get transparent you can demand responsibility”
• “Responsible politics are politics which put state interests in the first place, not the interests of particular groups” (Int.18)*
• “Access to information”
• “Work for the benefit of clients”
• “Listening to demands of people”
• “Those politicians who are in transparent positions and under media attention are forced to be accountable irrespectively to their political views (Int. No. 11)”.
• “The role of responsible policies increase year by year.
Many small political issues have been already resolved.
Now politicians understand that big issues have to be tackled for the sake of the state (Int. No.13)
• “Training of civil servants, the level of their competence”
• “Just consideration of cases”
• “Responsibility of elected officials”
• “Opportunities to participate in public hearings”
• “Transparent registration of public services on the Internet”
• “Rotation of elected officials”
• “Political responsibility means responsibility for development of Latvia, for Latvia’s integration into the European Union and NATO”
• “Irresponsibility”
• “Unwillingness to achieve political compromises”
• “People think that politicians do not account for their actions and it is impossible to influence them”
• “Squandering of public money”
• “Settling private affairs by means of politics”
• “Certain sectors of policies have been privatised by the political parties”
• “Politicians and government in Latvia are not accountable to the people”
• “Short term policies and inability of state
administration to think in long term perspective (Int. No.
16.”
• “Lack of political responsibility towards voters and citizens”
• Selfishness of politicians: “They mainly care about their own interests”
• “Those politicians who are in the shadow of parties can afford doing anything”
• “Population lacks information about their rights”
• “People are not aware of their role in governing processes and possibilities to influence policies”
• “Those who are in ruling positions rather account to their parties, not to the people or their conscience (Int.
No. 11)”
• Lack of popular demand for public accountability: “The society lacks the will and ability to consistently and permanently demand from the power the fulfilment of promises.”
• Fragmented party system: “Small parties do not think about state interests but about their survival”
• “Non-citizens are not represented in Saeima, they are excluded from politics”
• “Politics are moved by money of economic groups” (Int.
No.17)
• “Professional and competent people turn away from politics”
* The notion “state” in Latvian is often used as a synonym of the notions of “nation” and
“people”
It is obvious from the vocabulary that public interests dimension is underrepresented in political language and that there is a salient deficiency of responsibility in Latvia in relations between those who govern are those who are governed.
The discourse analysis suggests that actors interpret politics as accountable (in positive terms) if political and administrative actions conform to the principles of normative democracy, i.e. – if politics are honest, competent, responsible and transparent. And contrary, they perceive politics as irresponsible if actions undermine ideals of democratic governance.
In a recent study of public policy process in Latvia (UNDP 2001) the public, Parliament (Saeima) deputies and local government leaders assessed the observance of such democratic principles as competence, honesty, responsibility and transparency by government institutions (see Table 1).
Table 1. The observance of democratic principles in Latvian institutions
(% of respondents who answered “to a very large extent” and “to a fairly large extent”)
Institutions Evaluators “To what extent is decision-making by the following institutions honest, competent, responsible and transparent?”
Honest Competent Responsible Transparent The Saeima
(Parliament)
The public Saeima deputies
Local government leaders 14 54 25
39 85 58
24 57 30
19 58 28 Cabinet of
Ministers (Government)
The public Saeima deputies
Local government leaders 18 40 22
45 83 57
27 60 39
17 17 17 Ministries and
institutions under their supervision
The public Saeima deputies
Local government leaders 16 37 23
33 77 56
21 54 26
15 20 9 Local governments The public
Saeima deputies
Local government leaders 32 49 95
45 69 82
40 60 93
28 32 79 Non-governmental
organizations The public Saeima deputies
Local government leaders 37 74 58
33 40 38
35 46 40
29 54 39
All respondent groups gave Latvia’s State institutions the highest rating in decision-making competence, but the lowest rating in decision-making transparency. (The exception is the Saeima, where honesty in decision-making was rated even lower than transparency by all respondent groups, including the parliamentarians themselves.)
As opposed to decision-making in Latvia’s State institutions, all respondent groups deemed decision-making in NGOs to be highly honest and transparent (except by local government leaders, who gave much higher ratings to transparency in their own institutions). However, NGO competence was rated lower than that of State institutions by both local government leaders and the public.
All in all, the embodiment of democratic values in the activities of Latvia’s political institutions must be considered to be insufficient. In no case did the number of respondents rating the activities of these institutions as honest, responsible and/or transparent reach even half of those polled (UNDP 2001).
Interviews, surveys and case studies of public policy processes suggest that public accountability discourse and practices are vague in Latvia. There are several reasons behind this: weakness of civil society, low level of participation, public distrust in politics, abuse of power by politicians, insufficient administrative capacity of the state and other reasons. One should remember as well that democratic history is short in Latvia. In the beginning of transition in early 1990s political system was “positivist” and non-reflexive. It was oriented towards establishing of new democratic institutions and political elite was less concerned about the qualitative aspects of politics. Accountability looked a premature concept at early stages of transition or it was removed from public arena by the ruling elite which might have perceive it as an obstacle towards its privatisation strategies.
One way or another, the political system and political culture in Latvia during 1990s did not employ public accountability neither as a basic principle of political conduct, nor as a major issue of public scrutiny of political system. Accountability was not recognised as a key criterion of policy evaluation. Until very recently accountability was a peripheral concept in political discourse of all major policy actors: political parties, state administration, media as well as civil society organisations.
2.2. Concepts and ideas of public accountability
From the year 2000 onwards the public accountability debate is evolving in Latvia due to various facilitating factors. Accountability is becoming a reference notion for critical scrutiny of actions and habits of political parties, the government institutions, local governments. The year 2002 is a year of parliamentary elections in Latvia and several political parties have adopted accountability phraseology in their pre-election campaigns. This points to a growing public awareness of the importance of accountable governance. Evolving discourse brings to existence new understandings and also new procedures of accountability.
2.2.1. Seven discourses of public accountability
A closer look reveals that different stakeholders perceive public accountability (responsible politics, responsible governance) in different ways. Based on interviews and case studies it was possible to discern seven specific discourses of public accountability: a discourse of civil servants, a discourse of high rank government officials, a discourse of employees of public institutions, a discourse of policy experts, a discourse of political parties, a discourse of
“general population”, and a discourse of “typical individual citizens”.
• Perception of accountability by civil servants to a great extent depends on their position in a power hierarchy. At “lower levels” of state administration accountability is often understood “technically” as direct positional duties. The students who carried out case studies reported that in many instances civil servants did not use accountability concept in their vocabulary and even have difficulties to understand the meaning of this word. At the same time they might be fully responsible and accountable for their actions.
• At higher level of state administration, which is the level of the Government and ministries there are two rather conflicting discourses of approaches. One could be named
“an old discourse”, which is based of routine hitherto practices and experiences (more detailed analysis is given in Chapter 2.3.2). The other could be labelled “a new discourse”, which exemplifies the very recent government initiatives towards accountable policies. Officials of the State Chancellery, and the body of the state secretaries of ministries recently have undertaken steps towards improved policy planing and policy co- ordination. The government plans to adopt in 2002 the new Rules of Procedure of the Cabinet of Ministers – a document, which outlines and regulates the process policy formulation in government. The new rules envisage several consecutive steps in policy
formulation: setting of political priorities, using expert analysis, strategy formulation, planning of policies, consultations with public, evaluation of financial costs, choice of policy alternatives, taking optimal decisions, co-ordination between the ministries. An important component in this process is public consultations. Therefore government officials speak about accountability also in terms of public information, public participation in policy-making, and co-operation with NGOs. As a representative of the State Chancellery argued in an interview: “The level of responsibility varies in different ministries. The Ministry of Welfare usually submits to the Cabinet well-prepared policy documents, however it may depend on the Department. Usually those ministries which
“stand closer” to the interests of people, like Ministry of Welfare, demonstrate higher level of responsibility.” (Int. No. 12). Apart from this government officials also interpret accountability as rising of administrative capacity, implementing of administrative reforms, and rising policy efficiency.
• It is important for democratic governance that accountable procedures and mechanisms are enforced in public institutions, e.g. hospitals, schools, media, courts, and other institutions, which provide public services to the population. Case studies suggest that employees of public institutions tend to perceive responsibility in a very confined way as their direct professional duties, or even professional skills, but they are less mindful about their broader public responsibilities. Many professional associations in Latvia still do not have their ethical codes. The clients usually are in weaker power position in relation to public service administration. Application of laws and regulations in public institutions often depend on interpretation of service providers. It is customary that clients, for instance – hospital patients, have difficulties to protect their rights in case of conflict. Population is also little involved in setting quality standards of public services and control over them.
• Academic experts, political scientists and policy analysts demonstrate the most complex discourse of public accountability. First of all, they emphasise the public dimension of politics and policies, stressing that politicians should be responsible to people. Experts also indicate that the main problems, which hamper enactment of responsibility in politics, are the lack of responsibility of political parties, closed decision-making and influence of business groups on political parties. Experts also point to a widespread passivity of population to engage in politics and its excessive expectations towards the state and strong leadership. On the other hand, policy experts prise the recent government efforts to improve the decision-making process, co-ordinate policies, inform public, and involve population in different consultative councils and boards.
• The discourse of political parties is dual. At the rhetoric level of normative ideology, political parties claim that they follow the principles of transparency, honesty, accountability, commitment to the interests of voters in their policies. On the other hand, the existing system of party financing makes them largely dependent on sponsors and large business groupings. Therefore in practice political parties often sacrifice public interests in front of business interests or their own interests. One of the interviewed politicians characterised: “[Political] parties successfully distance themselves from responsibility. They reach peaks of irresponsibility. An example was the recent Parliament voting about the Law on Protected Coastal Zones. Some party leaders are very dependent on outside formations, and there no mechanisms how to control such leaders” (Int. No. 18). In opinion of this interviewee political irresponsibility originates from “struggles of economic groups for influence over political parties” and from inability of politicians to oppose to the pressure of private interests. This pressure of private interests along with egoism of politicians is real menace for accountable policies.
Interviewed politicians could not give examples of efficient mechanisms how this influence could be combated.
• The “general population’s” discourse of public accountability is influenced by high expectations that politicians and state institutions should implement policies on behalf of people and in their interests. The public perception of public competencies and responsibilities is very hierarchical – people tend to think that the ruling “top” has or should have great responsibility whereas the governed “bottom” has nearly no influence and responsibility. These expectations are seriously undermined by regular political scandals, cases of corruption, hidden decision-making, bargains between politicians and business groupings, nepotism. Dismantling of public interests considerably reduces trust in politics and causes disillusionment. Public interest in accountable politics is also lessened by economic hardships, unemployment and poverty experienced by a large part of inhabitants.
• Accountability of an “individual citizen” depends on his or her capacity (knowledge, skills, political will and available resources) to engage in political action, as well as on opportunities to do so (openness of decision-making and state institutions, favourable legislation, active NGOs etc.). In democracy every individual has a choice therefore it has responsibility. According to a comparative World Values Survey individuals in Latvia feel rather isolated. They are little attuned to sentiments of social solidarity neither willing to actively involve in politics. An “average individual” in Latvia is also hesitant to participate in community life (Zepa 2002). Individuals lack skills and positive experience of participation. On the other hand, there are many cases in Latvia when individuals start to behave illegally and amorally when they get elected in public positions and acquire possibility to influence decision-making and distribute public resources. The subtle link between democracy and political emancipation of an individual apparently has not been established yet in Latvia.
2.2.2. Concepts and normative ideas of public accountability
To summarise, there are several basic concepts and normative ideas of public accountability (or responsible policies and responsible governance) which are in use or emerge in current political discourse and practice in Latvia:
! access to government information;
! openness of decision-making process;
! transparency;
! anti-corruption;
! public participation in decision-making;
! consultations with population and interest groups;
! co-operation between state and municipal institutions and NGOs;
! policy efficiency;
! policy planing and policy co-ordination;
! strengthening of government administrative capacity;
! improving administrative process, administrative control and auditing;
! just courts and ombudsman;
! responsibility for economic and social consequences of implemented policies.
There are several domains or levels of policy-making (governance) in which these ideas are debated and translated into practical mechanisms:
! decision-making in Parliament and political parties or the level of political accountability;
! decision-making in the government and ministries or the level of administrative accountability;
! decision-making in local governments or the level of municipal accountability;
! decision-making in NGOs or the level of civic accountability;
! citizens’ political activity or passivity or the level of individual accountability.
Currently mechanisms and procedures of accountable decision-making are more introduced at governmental or administrative level, but to a less degree such mechanisms are introduced at political, municipal and NGOs levels.
There are several factors, which facilitate debate about responsible governance:
! the rise of civil society in Latvia. Currently there are more than 6000 registered NGOs and according to some surveys 6% of population are members of an NGO;
! emergence of advocacy NGOs which are active in promoting public interests in government;
! broadening of policy community which nowadays includes not only politicians and government officials but also NGOs, professional associations, policy institutes, experts and other actors;
! activity of watchdog organisations and media, which attract public attention to misuse of power, corruption and violation of public interests;
! government initiatives to improve policy-making and commitment of majority of civil servants to principles of good governance: participation, rule of law, transparency, responsiveness, consensus, social justice, efficiency, strategic vision;
! gradual development of democratic political culture and penetration of the ideas of open society, critical thinking, pluralism, tolerance, human rights;
! ideology of liberal democracy has had a dual impact. On the one hand it has helped to liberate an actor – a private entrepreneur, a citizen, an NGO leader, a political activist. On the other hand, individual freedoms during the transition were not always controlled by legal, civic and moral norms.
The main agents who advocate and promote responsible governance in Latvia are media, NGOs, international organisations and politicians and government institutions themselves.
Media in Latvia actively implements its role as a watchdog. It also actively influences political agenda. Media creates a space for public discussions by reviewing draft laws, publishing analytical articles and providing forum for representation of different views.
Though, experts admit that media in Latvia insufficiently reflects policy improvements and positive examples of public participation.
Civil society organisations, and in particular - professional associations are increasingly active in political process. For example, the Latvian Confederation of Employers, the Latvian Federation of Pensioners, the Latvian Association of Local Municipalities have established a regular dialogue with government. Sectoral associations, for instance, the Latvian Association of Small Traders and the Latvian Association of Agricultural Organisations co-operate with ministries in working groups and consultative committees. There are many other examples which testify that ministries are becoming more open for co-operation with NGOs in formulation and implementation of their policies. Though, representatives of NGOs would like closer co-operation and reproach ministries for participatory formalism no and then.
Ministries in their turn argue that NGOs often are weak and non-experienced partners in policy-making and that they often are not representing collective opinion of interest groups.
Government institutions are also the driving force towards accountable policies, despite they are often blamed for irresponsibility. Interviewed experts admitted: “State Chancellery, some ministries, the ministers who are not dependent on economic groupings, the educated civil servants are those who promote responsible policies” (Int. No. 14). Experts also emphasised that the highest representatives of the state – the President of the Republic of Latvia, the Prime Minister of Latvia are politically responsible. They also agreed that ministries by large are responsible for their policies, particularly indicating the Ministry of Finance and the
Ministry of Welfare. According to experts observations “political irresponsibility originates behind the highest state representatives in the shadow leadership of political parties” (Int.
No. 11). It is caused by the “influence of outside party [economic] formations on the party leaders” (Int. No. 18).
2.3. Political system
2.3.1. Constitutional framework and its functioning
Latvia’s political system is organized according to the Constitution (Satversme) adopted in 1922. The system contains the fundamental features of public accountability. These include regular free and fair parliamentary elections, executive responsibility vis-à-vis legislature, as well as reasonably independent judiciary.
Latvia is a democratic republic with a parliamentary system of government. The parliament (Saeima) is elected in general, equal, direct and secret elections, based on proportional representation. Latvia is divided into five electoral districts – Riga and four historical regions (Vidzeme, Latgale, Kurzeme, Zemgale). The Saeima has one hundred members. The parliament elects the President of State and approves the Cabinet of Ministers. The President is the head of state and serves largely representative functions. The President of Ministers, i.e.
Prime Minister and other ministers are responsible to the Saeima and must enjoy its confidence. The Saeima approves judges who – once appointed for life tenure – are irremovable, independent and subject only to the law (Kalniņš 2001d).
Only legally registered political parties and legally registered associations of political parties may present electoral lists of candidates. The election threshold of four percent was set for the elections of the 5th Saeima in 1993. This was raised to five percent for the elections of the 6th and 7th Saeima in 1995 and 1998 respectively (Kalniņš 2001a).
Latvian constitutional norms are usually regarded as reasonably appropriate from the point of view of public accountability. The basic accountability chain includes public administration, ministers and the President of Ministers, the Saeima, and ultimately the people. Namely, public administration is accountable to ministers and – through them – to the President of Ministers. Ministers and the President of Ministers are accountable to the Saeima. Finally the Saeima is accountable to the people.
At times proportional representation has been criticized for its inability to ensure sufficient accountability of representatives vis-à-vis their constituencies: “On the one hand the proportional representation is not so good because there is apparently no direct linkage [between the representative and his or her constituency). But on the other hand, changeable lists are a very good thing.” (Int. No. 4) Changeable lists allow voters to cast their vote for a particular political party but meantime they can either cross out or give a bonus to particular candidates. Voters increasingly tend to use this opportunity and some unpopular candidates are known to have moved from the top of the list to the bottom and thus failed to get elected.
In public discussions, proposals have been made to opt for some sort of “first-past-the-post”
plurality system or a mixed system but these have never gathered sufficient political support.
Another permanent issue is possible changes in the status of the President of State. In the summer of 2000, some 63% of all respondents in an opinion poll supported the introduction of a popularly elected president. (Ikstens 2001:4) Focus group discussions revealed that the need for responsibility in the making and implementation of political decisions was mentioned among major reasons for such a change. (Ikstens 2001:20,21) In 2001 the leader of
the Social Democratic Workers’ Party Juris Bojārs presented draft amendments to the Constitution that – among other things – would introduce a popularly elected president.
However, at present the adoption of these amendments is not likely.
Public accountability is somehow diminished by the high degree of centralization that is inherent in the parliamentary system. While the legislature and executive are institutionally separate, the same political parties form both the Cabinet and the majority of the legislature.
This is sometimes viewed as a problem: “The separation of powers does not function. There is no mutual control between, for example, the Saeima and the Cabinet of Ministers.
Therefore there is an attempt to amend the Constitution and to endow the President with greater powers.” (Int. No. 5)1
Another block of criticism is connected with the perception that the Satversme in conducive to instability: “Political parties and their fight for portfolios determine too much, governments keep on fluctuating between falling and not-falling. The same took place in the 1920’s and 1930’s. Weimar type of constitution is not suitable for a society that is not mature enough for democracy.” (Int. No. 5) The instability is indeed remarkable – since 1993 Latvia has had eight cabinets with the average duration of slightly more than one year. This may have had a negative effect on political accountability. While cabinets often tend to be formed by the same parties, they also tend to feel limited responsibility for promises and decisions made by previous government.
Decision-making in the Saeima receives controversial evaluations. On the one hand, the Saeima has several important transparency features. All Saeima plenary meetings are open to public unless the Saeima decides otherwise (the latter case is extremely rare). Radio broadcasts the Saeima debates and their transcripts are published fully. Moreover the Saeima web page provides the texts of all pending bills and the agendas of the plenary meetings and other Saeima structures such as parliamentary committees. Almost paradoxically parliamentary decision-making has been subject also to harsh criticism because of its secrecy:
“The adoption of laws is most difficult. It happens in a highly secret mode. There are proposals and you don’t know in whose interests they are submitted.” (Int. No. 6) This quotation refers to the situation where each individual member of parliament may almost at any stage submit proposals to pending bills. He or she is not formally required to present any motivation for the proposal. This means that in principle the Saeima may adopt any legal norm whatsoever without being legally obliged to give any motivation for its action.
1 The interviewee referred to the draft amendments to the Constitution proposed by the leader of the Social Democratic Workers’ Party.
While the present constitution is by and large the same as adopted back in 1922, several new public accountability features were set up in the 1990’s. Among these the Constitutional court (Satversmes tiesa) is of special importance. In 1996 the Saeima adopted the Constitutional court law.2 The Saeima, the President of State, no less than 20 members of Saeima, the Cabinet of Ministers, a local government, the Plenum of the Supreme Court, the Public Prosecutor General, the council of the State Audit, the State Human Rights Bureau, and a minister authorized by the Cabinet may submit a claim to the Constitutional court. Since 2001 also an individual citizen may submit a claim to the Constitutional court if his or her fundamental rights have been violated (Kalniņš 2001c).
The importance of the Constitutional court has been confirmed also in the interviews: “The creation of the Constitutional court is an achievement. Other countries have problems that the rulings of constitutional courts are not respected. In our country it’s different. Here the rulings [of the Constitutional court] are respected and implemented.” (Int. No. 5) In 2001 a former member of parliament submitted an individual claim in the Constitutional court regarding allegedly illegal additions to the salaries of the members of the Saeima. The members of Saeima are entitled to several types of compensation, e.g. a compensation for the rent of residential premises. The alleged violation of the law is in the fact that these compensations have been paid to the members without presenting any proof of actual expenditure. The court decision on this matter is still pending but in any case this will be a highly relevant demonstration of whether and how the Constitutional court may hold politicians publicly accountable.
Other amendments to the Constitution include the increase of term of legislature from three to four years since 1998. Some observers argue that this, while not being among the most significant issues, will contribute to somehow reduced accountability. Namely, the period between moments when the people may hold their representatives accountable is increased:
“We may argue whether or not there was any sense to change the Saeima election period from four to three years. [..] We should change back to the three years election period of the Saeima.” (Int. No. 4)
2.3.2. Public administration
With varying success, public accountability mechanisms have been embodied also in the public administration. Latvia started the transformation of its public administration in 1993 when the Cabinet of Ministers decided to dismiss all ministerial personnel. This allowed the government to form the central state apparatus anew according to the logic of a democratic state. In April 1994 the Saeima adopted the law on state civil service. The purpose of the law was to replace the old soviet type of civil service relations with a modern carrier and qualification based civil service. The idea was to establish a uniform civil service for all administrative bodies. All public employees above certain level of responsibility would first
2 The Constitutional court adjudicates in cases on: (1) the conformity of laws with the Constitution; (2) the conformity of signed or concluded international agreements with the Constitution; (3) the conformity of the Saeima decisions with the Constitution and other laws; (4) the conformity of Cabinet acts with the Constitution and other laws as well as the conformity of acts by institutions and officials that are subject to the Cabinet with the Constitution, other laws and the Cabinet regulations; (5) the conformity of acts by the President of State, the chairperson of the Saeima and the President of Ministers with the Constitution and other laws; (6) the conformity of normative acts issued by institutions or officials that are approved, appointed or elected by the Saeima with the Constitution or other laws; (7) the conformity of binding regulations or other normative acts issued by a local government with the Constitution, other laws and the Cabinet regulations; (8) the conformity of an instruction whereby a minister suspends a decision by a local government with the law; (9) the conformity of Latvian national legal norms with international agreements that Latvia has entered into and that do not contradict to the Constitution (Kalniņš 2001c).
gain the status of candidate civil servants and then full-fledged civil servants. In 1994 and 1995 more than 14 000 persons passed a qualification exam to become candidate civil servants. In order to become a civil servant, a candidate had to pass a new examination.
However, the reform never became complete as initially intended due to several restraints. It was only possible to gain the full status of a civil servant as late as in 1999. The delay was partly due to limited resources and a significant number of qualified employees did not receive a chance to acquire the status of civil servants in due time (Kalniņš 2001b).
The institutional reform was followed by attempts to change and democratize the quality of administrative process. This required the strengthening of the rule of law throughout the administration and extensive training for state employees. Since 1995 the State School of Administration is in charge of training for civil servants. However, the reforms of public administration lost their momentum and political backing after 1995. Latvia’s banking crisis of 1995 together with certain underestimation of the importance of high quality public administration and possible corruption among top political leadership led to neglect with regard to these issues. The focus on administrative reforms came back only as recently as 1999 largely due to criticisms from the European Union (Kalniņš 2001b).
While the idea to modernize the public service was very positive in the context of strengthening public accountability, the delays and insufficient coherence of the reforms are viewed as counterproductive to public accountability: “In 1995-2000 the administration underwent numerous rapid changes but written documents did not always reflect actual processes. The problem was that government declarations were made up in short time in the situation of compromise. Rapidly changing governments would not continue the work of their predecessors. They commenced work but, when first results could be expected, the policy had already changed. However, now we have managed to stabilize reforms.” (Int. No. 1)
In September 2000 the Saeima adopted a new civil service law. According to the law an increased number of state employees will be considered civil servants. This implies that a greater number of state employees are subject to a uniform wage and social guarantees system. Civil servants also must comply with certain uniform qualification requirements, e.g.
higher education. In December 2001 the Saeima also adopted a draft law on the institutional structure of the state administration in the second reading. In October 2001 the Saeima adopted the administrative process law. This law would enter into force in 2003. Among the principal goals of the law are (1) protection for human rights and other democratic principles in relations between individuals and the state, (2) the establishment of independent judicial review (by means of currently non-existing administrative courts) over administrative activity versus individuals, and (3) the precise and correct application of legal norms within the administrative process (Kalniņš 2001c). The actual achievement of these goals will be crucially important for strengthening of public accountability.
In Latvia a commonly mentioned problem is the inability to hold public officials financially liable when their decisions or actions intentionally or accidentally make losses to public budgets: “We allow an individual to go to the Constitutional court. The next step would be to say who is responsible if the Constitutional court finds a law unconstitutional. Who covers the loss that is done to the state?” (Int. No. 3) Numerous scandals whereby public budgets have lost large amounts of money have triggered discussions that the guilty officials should be obliged to compensate for the loss financially. The draft law on the institutional structure of the state administration provides that public officials may be held financially liable.
Another problem is the lack of coordination among various sectoral bodies in the process of policy making. Different institutions that work with related policy issues but are located
within different ministries would pursue uncoordinated and sometimes contradictory goals, thus undermining the effectiveness of respective policy. The law on the institutional structure of the state administration is thought to improve this situation: “It is crucial that we adopt the law on the institutional structure of the state administration. Initially the system was intended to be highly hierarchical without sufficient horizontal cooperation. The horizontal cooperation must be institutionalized. Each civil servant should have his or her circle of persons in significant issues.” (Int. No. 1) In an ideal case, whenever there is a policy issue, all institutions, non-governmental organizations and other actors who have a stake in the issue would closely cooperate.
However, the modernization of civil service has not necessarily established full-fledged public accountability. Politically appointed higher officials tend to feel more responsibility vis-à-vis their political patrons rather than the broader public: “Administrative structures are politicized. The higher level of public officials is politically created. Consequently they are responsible vis-à-vis the elite rather the public.” (Int. No. 8) Policy making in a number of areas remains somewhat closed for influence from, for example, non-governmental organizations and citizens’ efforts: “You have to be a very influential person to make any use of your personal activity.” (Int. No. 4)
2.4. Public sphere
Public sphere in Latvia has been thoroughly analysed in the Latvia Human Development Report 2000/2001 on the Public Policy Process. The Report boldly highlights an idea, that policy making is not only the exclusive domain of state, parliament or government, and that individuals themselves are the ones who shape policy. The goal of democracy is not to develop an ideal society, but rather to expand the public arena where people can express their freedom and responsibility. Democracy does not create a state of justice, it merely strengthens the public arena within which everyone has the right to act (UNDP 2001: 134, Tadjbaksh 2002).
In the private sphere people form their individual identities and satisfy their individual interests. In the public sphere which is the domain of civil society and the state people communicate and balance their interests. The public manifestation of individual interests and identities, as well as their complete realisation, is only possible in public sphere. Public sphere also permits the fulfilment of the common interests and common good. From this perspective, public policy manifests itself in society as connector between private and public spaces, and as co-ordinator and promoter of interactions between often variable and conflicting interests of different agents and institutions (Tisenkopfs 2001a).
Therefore public policy needs a democratic and open public sphere in which policy-making can only become democratic, open and accountable. If there is no developed and diverse public sphere filled with vibrant civil society, if there is little participation and political interactions of different social actors there is a risk that policies might become captured by narrow interest groups which then act irresponsibly for the sake of their own benefit.
Public sphere requires democratic and open public policies and vice versa. Accountable governance results from a merger of democracy and public space. fragmentation of public sphere dilutes public policies and the way round – undemocratic policies distort public arena.
Analysis of public policy in Latvia allows to conclude, that political decision-making process is rather closed. Important decisions, which affect society, are often made in a closed triangular relationship between leaders of economic groupings, political leaders and so called
“grey cardinals”. Closed, inaccessible and half-legitimate mechanisms are often used at the
expense of open parliamentary debates and public consultations. The political process by large is characterised by lack of transparency, participation, and accountability and suffers from dependency of political parties on economic groupings (Tisenkopfs 2001b).
As a result of these tendencies public is not confident about its possibilities to influence politics and distrust institutions. They blame politicians for being egoistic and civil servants – for being bureaucratic. Some of the findings of the Latvia Human Development Report 2000/2001 reveal distortions of politics and public sphere (UNDP 2001:18-19, Tadjbaksh 2002):
! Low trust in public policy: only one tenth of those surveyed (inhabitants, Saeima deputy and local government leaders) believe that Latvia is a country where the public supports its politicians and that politicians are accountable to the public.
! Economic capture of the state under which laws, regulations and other decisions adopted by state institutions might be passed in the interests of small groups or individuals, and under which public officials and politicians might received illegal private benefits.
! State institutions get the highest mark in decision making competence, but the lowest ranking in decision making transparency.
! Majority of polled (78%) believe that decisions made by politicians affect their lives to a great extend, but very small proportions (5%) believed that they can significantly
influence decisions.
! Most people believed that they can influence policy making more at the local government level than at national level.
The study of public policy confirms that there are two parallel systems of decision making:
one that is legal, multiparty, public and based on democratic principles, and another that is based on corporate and corrupt interest groupings and a personal contact system. However, it is important to emphasise that with the rise of civil society and participation open decision- making practices are contesting the tendency of closed policies.
It is important that majority of political actors, including government look upon social dialogue as one of the key mechanisms to improve policies and make them more transparent, accountable and efficient. State institutions in general are becoming more open and ready for dialogue with society. It is very much the learning process in which civil society gradually engages in the whole complexity of policy making.
2.5. Private sector
The radical liberalisation strategy implemented by Latvian political elite and the right-wing coalition governments in the 1990s has fostered establishment of basic market institutions, a spirit of entrepreneurship and a rather strong SMEs sector. Liberal reforms have resulted in a rather fast economic growth in comparison with other former socialist countries, which adopted gradual change strategies. In the meantime market liberalisation was accompanied by spread of black economy, smuggling, corruption and other “side effects” of early capitalism.
These tendencies have had spoiling effect on business environment, fair competition and business-government relations. However, nowadays there is a tendency that business is becoming more civilised, businesses turn to legal practices, pay taxes, establish their own social responsibility and ethical codes.
If we view the private sector as primarily business, its influence on public policy and public accountability is highly controversial. Large corporate business may be regarded as one of the most influential groups of political actors. The authors of the Latvia Human Development Report 2000/2001 concluded: “The most influential political decision-makers and influencers
of the policy-making process are the Cabinet, the Saeima, leaders of business groupings, political leaders, “gray cardinals” and the media (UNDP 2001:71).”
Even though leaders of business groupings are named right after the Cabinet and the Saeima, the whole business sector cannot be regarded as uniform mass. Not all businesses are influential. Therefore we should distinguish at least two dimensions.
2.5.1. Legitimate vs. illegitimate influence
First, we may distinguish the type of private sector influence that strengthens public accountability and the type that weakens public accountability. For example, the participation of private sector entities in public consultative councils clearly strengthens the accountability of relevant public institutions. Let us mention here the Foreign Investors’ Council and the Tripartite Cooperation Council where employers’ representatives, labor unions and the government meet. Some interviewees mention also public procurement as a sphere where private entities strengthen public accountability by using formal channels of complaints and remedies: “In the area of public procurement, IT companies, construction companies and, car dealers are competing hard and thereby strengthen accountability.” (Int. No. 3)3
One may also argue that, thanks to the lobby from businesses, politicians can be held at least in some way accountable. There are examples where – however closed and privately motivated – business influence has played a positive role: “The private sector in Latvia has developed in a highly uneven manner. It is influential in terms of resources and connections and this lobby forces politicians be responsible. A bright example here is Latvia’s participation in the [EU] “Northern Dimension” [initiative]. The government created a working group as a result of rough pressure from the oil transit. Also the banking sector is largely interested in public accountability because they are interested in an orderly environment.” (Int. No. 8)
Meantime various forms of private sector participation weaken public accountability. Here we talk about some sort of merger between private and public entities and actors: “Other larger economic groups are tightly connected with political parties. They achieve their protection by being close to the parties. I’m not sure to what extent they are interested in the state being able to protect them. I don’t know when is the moment when it is better to strengthen honest police rather than hire 50 security guards.” (Int. No. 3) The above quotation indicates also the unwillingness of at least some private sector actors to strengthen public accountability mechanisms. Some views are even more radical: “Business organizations favor non-public accountability and closed transactions. Sometimes business may use public accountability mechanisms if it is in their interest but basically [they do] not.” (Int. No. 4) The merger between the two sectors is strengthened on an individual level by persons who switch between business and political positions: “We see that many politicians have become businessmen.
Moreover lately businessmen become politicians.” (Int. No. 9) While such change of roles in itself is not illegal or particularly illegitimate, it – if taking place on regular bases – increases the risk that particular private interests begin excessively dominate public interests.
The domination of large corporate interests is closely connected with the so-called state capture. The term “state capture” refers to the situation where firms make illegal payments in order to shape governmental, parliament, court and other decisions that form the rules of the
3 It is, however, true that the complaints system in public procurement was extremely ineffective until the end of 2001. In the majority of cases, the review of complaints would give nothing more then the identification of violations. Virtually no remedies existed. The system saw considerable improvement starting with January 1st, 2002 when a new public procurement law came into effect.
society (laws, etc.). This is opposed to administrative corruption where illegal payments are made in order to distort the application of already pre-existing rules. The World Bank research has indicated that Latvia is a country where the state capture has reached a relatively high level. (See, for example, Hellman J.S., Jones G., Kaufmann D. 2000.)
The widespread application of illegitimate channels of influence has contributed to generally negative perceptions about the role of business in policy contexts: “Our business sector is used to solving problems in a way that unacceptable in an ethical society. I even wonder why the business agrees to it and does not want to change the situation. They even themselves say that it is bad but they would not change.” (Int. No. 7) Virtually all instances of business influence are self-interest driven: “I have not noticed that the private sector influences the public accountability situation. They have private interests. It happens that they fight for public contracts.” (Int. No. 5) The policy conclusion from this statement is that business interests – no matter how legitimate – should be counterbalanced by public considerations where the society at large plays an important role.
2.5.2. Large vs. small business
The other dimension to distinguish is the size of private sector entities. The general observation is that larger entities or the big corporate business exert a great deal of influence on public policy making while small and medium size business has very limited access: “The influence of private actors… It’s those who are economically stronger and where it is advantageous.” (Int. No. 3) “The other group is small and medium-size business that has minimal influence. This lack of influence is due to not only the unwillingness of the political elite but also the inability of the small business to use available channels.” (Int. No. 8) Some business representatives testify that large enterprises and foreign investors have advantages in dialogue with government: “Currently government is engaged in a rather active dialogue with foreign investors and large enterprises. But government should definitely talk more with small businesses and their associations.” (Int. No. 14).
These observations partly confirm the characterization of closed policy-making as described in the Latvia Human Development Report 2000/2001: “Closed policy-making may serve specific businesses and party financiers, but it does not serve business as a whole, because some businesses will exercise greater influence on economic policies, while many others will be rejected – particularly the small and medium-sized ones, which do not appear attractive to politicians as sources of funding for their parties.” (UNDP 2001:31)
In addition to large corporate business, organized business is also said to exert certain influence: “Professional unions are strongest. They have broad public interests and they are influential.” (Int. No. 6) However, in most cases such professional organizations are not regarded as close to anything as influential as large firms and their groups.
